Matrix Communications Group, the UKβs fastest growing network communications integrator, has announced its acquisition of Decorum Networks (Decorum). Matrix will pay a total consideration of up to Β£2.26m subject to Decorum achieving Β£3m of turnover and Β£500,000 operating profit for the period 1st May 2004 to 30th April 2005.
Decorum provides specialist Voice over IP solutions for both private and public sector companies including the Guardian Newspaper, Swiss Life and City of London Police. The company offers large organisations a range of services that include IP telephony, convergence, computer telephony integration, call centre technology, unified messaging and additional data and telephony services.
With the acquisition of Decorum, Matrix has successfully completed the third stage of its strategy to build the UKβs communications integrator of choice for leading edge technologies and to utilise the cross-selling opportunities that exist across its existing, largely blue chip, customer base.
Alan Watkins, Chairman of Matrix said: βThis is another substantial step forward for the Group and brings us to the final stages of becoming the UK's communications integrator of choice for leading edge technologies. Through our current offerings we have matured our commercial relationships with several of the UK's largest blue chip companies and I have every confidence in our ability to build the level of cross selling between our subsidiaries. Our award winning reputation for expertise, reliability and after sales support makes us the natural choice for our customers to provide further services as their needs grow. The acquisition of Decorum gives us the ability to provide high quality Voice over IP solutions and we intend to leverage our reputation and current relationships to quickly and aggressively penetrate a market estimated to be worth $5.7billion by 2008.β
Following the completion of the acquisition, Neil Sturgess has joined the board of Matrix. Sturgess has 25 years experience within the IT and Voice market and prior to establishing Decorum held positions with Case Communications, Linx Communications and Rank Xerox International.
Watkins added: βWe have already proven our ability to continually extract cost synergies within the Group and I expect the performance of Decorum to benefit from this and other aspects of the management expertise now available to the company.β
Notes about release:
Audited financials to 31 December 2003 show a combined annual turnover of Β£2.764m and an EBIT of Β£47,000. Audited financials for the period 1 January 2004 to 29 Feb 2004 show combined revenue of Β£435,919 and an EBIT of Β£7,563.
Net assets being acquired are (Β£114,000). T his includes cash of Β£100,000 and deferred revenue of over Β£500,000. Decorum has recurring revenues of Β£1.6m. There are Β£368,000 of tax losses in Decorum that will be available to it within the Matrix Group.
These results are drawn up on accounting policies consistent with those of Matrix.
Matrix has paid an initial consideration of Β£1.195m, of which Β£695k was paid in cash and Β£500k in new ordinary shares in Matrix, (17,667,844 shares at 2.83p).
Application has been made for these shares to be admitted to AIM and this is expected to take place on 30th April 2004. Subject to the achievement of agreed performance targets, a further payment of Β£150k cash and Β£382.5k in shares may be made after 31st October 2004 and a final payment of Β£150k cash and Β£382.5k in shares after 30th April 2005. In order for the vendors to receive the full earn-out consideration, Decorum will need to achieve revenues of Β£3m and operating profits of Β£500k for the period 1st May 2004 to 30th April 2005. The vendors have agreed to retain any Matrix shares for a period of 12 months from the time of issue.
Neil Sturgess (aged 44) has joined the board of Matrix following completion of the acquisition. Neil has 25 years experience within the IT and Voice market and prior to establishing Decorum held positions with Case Communications, Linx Communications and Rank Xerox International.
About Matrix Communications Group:
The Matrix Group is the first large-scale integrator in the UK focused on delivering performance solutions for its customers. Matrix lead with the worldβs leading technology manufacturers using a βbest of breedβ approach. To ensure Matrixβs customers receive the purest form of expertise Matrix operate within defined technology verticals, these are IP Infrastructures, Security and Support Services.
Gareth Moss, Clarity Public Relations
Tel: 0118 925 5975
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